Ethereum (ETH) Grapples with Regulatory and Technical Hurdles Amidst Busy Week


Ethereum (ETH) is navigating a multifaceted environment this week, with developments in regulation, technical analysis, and the vision of its co-founder Vitalik Buterin all vying for traders’ attention.

Ethereum Price Chart

Bitwise Files for Spot Ethereum ETF, But Approval Chances Remain Low

On March 28th, Bitwise, a well-known crypto asset manager, filed an S-1 form with the SEC, the first step in the application process for a spot Ethereum ETF. This filing was followed by a 19b-4 form, indicating Bitwise’s intent to list the ETF on a stock exchange.

While some in the crypto community saw this as a positive sign for regulatory approval, analysts like Bloomberg’s Eric Balchunas cautioned that the chances remain low.

Bitwise’s existing BITB spot Bitcoin ETF serves as a reference point, currently holding the fourth-largest position in Bitcoin (BTC) under management.

Vitalik Buterin Proposes Raising Rollup Standards, Outlines Ethereum’s 2023 Roadmap

In a recent blog post, Ethereum co-founder Vitalik Buterin called for stricter standards for projects claiming to be “rollups” – a Layer 2 scaling solution designed to reduce transaction fees on the Ethereum network. He emphasized the need for developers to prioritize decentralization efforts by the end of 2023.

Buterin highlighted Ethereum’s transition from a “rapid L1 progress era” to a more balanced approach focused on both Layer 1 improvements and Layer 2 scaling solutions. He outlined the roadmap for the rest of 2023, focusing on:

Increasing blob capacity: This involves implementing data availability sampling to allow Ethereum blocks to hold more data for L2 projects, potentially reaching 16MB per slot.

Optimizing Layer 2 solutions: Techniques like data compression, optimistic execution, and improved security will be explored to enhance efficiency.

Moving towards “stage 2 rollups”: This signifies rollups that are truly backed by code, minimizing reliance on a security council for intervention.

Buterin acknowledged that significant changes like Verkle trees, single-slot finality, and account abstraction are still on the horizon, but they won’t be as transformative as the recent proof-of-stake and sharding upgrades.

Technical Analysis Points Towards Potential Breakout or Retracement

Currently trading at $3,560, Ethereum faces resistance at $3,600 and a major hurdle at $3,630 (76.4% Fib retracement level). Overcoming these hurdles could trigger a rally towards $3,800 and potentially even $4,000.

However, failure to break above these resistance zones could lead to a decline towards $3,450 and potentially lower, with $3,250 acting as a critical support level.

Ethereum Price Chart

The MACD indicator is currently losing momentum in the bullish zone, suggesting a potential slowdown in the upward trend. The RSI sits above 50, indicating that Ethereum is neither overbought nor oversold, leaving room for either a breakout or a retracement.

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